The 10% tariffs will not kick in immediately but will undergo a two-month review process, with hearings Aug. 20-23., according to a statement from the U.S. Trade Representative’s office Tuesday. The proposed list of goods includes consumer items such as clothing, television components and refrigerators as well as other technology products.

“For over a year, the Trump administration has patiently urged China to stop its unfair practices, open its market, and engage in true market competition,” U.S. Trade Representative Robert Lighthizer said in announcing the proposed tariffs.

“China has not changed its behavior -- behavior that puts the future of the U.S. economy at risk. Rather than address our legitimate concerns, China has begun to retaliate against U.S. products. There is no justification for such action.”

The Shanghai Composite and the Shenzhen Component opened 1.7% and 2.5% lower on Wednesday following the news. Hong Kong’s Hang Seng Index also fell 2.0%.

"American families are the ones being punished. Consumers, businesses and the American jobs dependent on trade, are left in the crosshairs of an escalating global trade war,” said Hun Quach, the head of international trade policy for the group.

“This latest story will serve as a reality check for the market, reminding investors to reconsider how aggressive they want to be,” said Michael O’Rourke, chief market strategist at JonesTrading. “Regardless, the $200 billion in potential additional tariffs is not a surprise. The President made everyone well aware of them.”

Elsewhere, Japan’s Nikkei 225 was down 1.7% in morning trade. The country’s core machinery orders fell 3.7% in May, Cabinet Office data showed on Wednesday, compared with economists' median estimate of a 5.5% drop. It followed a 10.1% rise in April.